Disney misses expectations with lackluster quarter

The company couldn't give analysts what they wanted to see on profit or revenue.

By Kim Peterson Nov 11, 2010 5:48PM
Credit: (© 1995 - 2010 Disney/Pixar)
Caption: Toy Story 3Even bolstered by two big guns -- "Toy Story 3" and ESPN -- Disney (DIS) reported a disappointing quarter that couldn't match analyst expectations.

The quarter was also dragged down because it had one less week than the year-ago period, and because of an accounting shift in the way revenue is recognized.

Disney reported an $835 million profit, or 43 cents a share, for the quarter ended Oct. 2. That's down from $895 million, or 47 cents a share, in the year-ago period.

After removing some one-time charges, profit came to 45 cents a share. That's still a penny less than what analysts were expecting.

The company blamed the drop on a shift in some revenue from the ESPN cable network to the third quarter. That shift contributed to a 9-cent hit to EPS, the company said. Post continues after video:
Disney reported revenue of $9.74 billion, a drop from $9.87 billion in the year-ago period. Analysts were expecting $9.95 billion.

The quarter gave Disney problems to the very end. The company was supposed to release its earnings after the bell, but the release inexplicably appeared on Business Wire around 3:30 p.m. EST. Oops.

The news sent Disney shares down nearly 3% to close at $35.93. The stock was essentially flat in after-hours trading.

Revenue fell 7% for Disney's cable and broadcast operations, while the parks and resorts segments saw a 1% drop. Disney said that costs were higher at its resorts, while hotel occupancy was lower.

The studio entertainment division saw a 6% revenue increase, largely due to the international success of "Toy Story 3." Consumer products sales rose 13% and interactive media sales rose 20%. But both of those categories are quite small compared to Disney's broadcast and theme park businesses.

Nov 12, 2010 2:55AM
you don't suppose that a lot of people have had to bypass the theme parks due to the price increase.
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